Accounting Ratios MCQ Questions for Class 12 Accountancy Chapter 10 with Answers

NCERTCOURSE.COM- Find here the NCERT/CBSE chapter-wise Multiple Choice Questions from Class 12 Accountancy book Chapter 10 Accounting Ratios with Answers Pdf free download. This may assist you to understand and check your knowledge about the chapters. Students also can take a free test of the Multiple Choice Questions of Accounting Ratios. Each question has four options followed by the right answer. These MCQ Questions are selected supported by the newest exam pattern as announced by CBSE.

MCQ Questions for Class 12 Accountancy with Answers

Q1. Current assets are those assets which are convertible into cash within:

(i) One month
(ii) 6 months
(iii) 12 months
(iv) none of these

(iii) 12 months

Q2. Long term solvency is indicated by :

(i) Current Ratio
(ii) Quick Ratio
(iii) Net Profit Ratio
(iv) Debt/Equity Ratio

(iv) Debt/Equity Ratio

Q3. Which one of the following ratios is most important in determining the long-term solvency of a company ?

(i) Profitability Ratio
(ii) Debt-Equity Ratio
(iii) Stock Turnover Ratio
(iv) Current Ratio

(ii) Debt-Equity Ratio

Q4. Acid Test ratio comes under:

(i) Liquidity ratio
(ii) Solvency ratio
(iii) Profitability ratio
(iv) Activity ratio

(i) Liquidity ratio

Q5. The solvency position of any firm is determined and measured with the help of

(i) None of the options
(ii) Activity Ratios
(iii) Profitability Ratios
(iv) Solvency ratios

(iv) Solvency ratios

Q6. Proprietory Ratio indicates the relationship between proprietor’s funds and….

(i) Reserve
(ii) Share Capital
(iii) Total Assets
(iv) Debentures

(iii) Total Assets

Q7. Which of the following will increase the current ratio where it is 2 : 1 ?

(i) Payment to creditors
(ii) Conversions of receivables into cash
(iii) Purchase of goods on credit
(iv) Purchase of goods for cash

(i) Payment to creditors

Q8. The __ ratios are primarily measures of return :

(i) liquidity
(ii) activity
(iii) debt
(iv) profitability

(iv) profitability

Q9. Profitability Ratios are generally expressed in :

(i) Simple Ratio
(ii) Percentage
(iii) Times
(iv) None of these

(ii) Percentage

Q10. Long term solvency ratio is judged by which of the following ratio?

(i) Debt equity ratio
(ii) Total assets turnover ratio
(iii) Liquidity ratios
(iv) Operating ratio

(iii) Liquidity ratios

Q11. The excess of Current ratio is also treated as a sign of managerial

(i) Inefficiency and Efficiency
(ii) Efficiency
(iii) Inefficiency
(iv) None of the options

(iii) Inefficiency

Q12. The ratios are primarily measures of earning capacity of the business.

(i) Liquidity
(ii) Activity
(iii) Debt
(iv) Profitability

(iv) Profitability

Q13. In debt equity ratio, debt refers to

(i) Short term debts
(ii) Total debts
(iii) Shareholders’funds
(iv) Long term borrowings and long term debts

(iv) Long term borrowings and long term debts

Q14. The __ of business firm is measured by its ability to satisfy its short-term obligations as they become due :

(i) activity
(ii) liquidity
(iii) debt
(iv) profitability

(ii) liquidity

Q15. Operating Ratio is:

(i) Profitability Ratio
(ii) Activity Ratio
(iii) Solvency Ratio
(iv) None of these

(i) Profitability Ratio

Q16. Interest coverage is equal to

(i) Interest after interest but before tax / interest on debt
(ii) Interest before interest and tax / interest on debt
(iii) Interest after interest and debt / interest on debt
(iv) Interest on debt / Interest before interest and tax

(ii) Interest before interest and tax / interest on debt

Q17. Current Ratio is 3:4, Current Liabilities Rs. 24000, the amount of current assets will be

(i) Rs 15000
(ii) Rs 18000
(iii) Rs 16000
(iv) Rs 20000

(ii) Rs 18000

Q18. Which of the following non-operating expense?

(i) Rent
(ii) Selling Expenses
(iii) Wages
(iv) Loss on Sale of Machinery

(iv) Loss on Sale of Machinery

Q19. Cost of revenue from operations is the difference between

(i) Revenue from operations + Gross Profit
(ii) Revenue from operations – Gross Profit
(iii) Revenue from operations – Net profit
(iv) Revenue from operations + Net Profit

(ii) Revenue from operations – Gross Profit

Q20. The __ measures the activity of a firm’s inventory.

(i) average collection period
(ii) inventory turnover
(iii) liquid ratio
(iv) current ratio

(ii) Inventory turnover

Q21. The term fixed assets include :

(i) Cash
(ii) Machinery
(iii) Debtors
(iv) Prepaid Expenses

(ii) Machinery

Q22. Capital Employed is equal to

(i) Fixed Capital+Working Capital
(ii) Total Assets-Total Liabilities
(iii) Total Assets
(iv) Total Liabilities

(i) Fixed Capital+Working Capital

Q23. When opening stock is ₹ 50,000 closing stock ₹ 60,000 and cost of goods sold is ₹ 2,20,000, then stock turn over ratio is:

(i) 2 times
(ii) 3 times
(iii) 4 times
(iv) 5 times

(iii) 4 times

I Think the given NCERT MCQ Questions for class 12 Accountancy book Chapter 10 Accounting Ratios with Answers Pdf free download will assist you. If you’ve got any queries regarding CBSE Class 12 Accountancy Accounting Ratios MCQs Multiple Choice Questions with Answers, drop a comment below and that we will come back to you soon.

MCQ Class 12 Accountancy with answers Part A & Part B

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